from the can-we-stop-spreading-the-myth? dept

One of the key talking points that we've heard from the "haters" of the new music business models is the claim that Spotify pays next-to-nothing to artists. This is really based on a few stories, taken totally out of context, concerning a few artists who received relatively small checks from Spotify. David Lowery actually used this as a key point in his screed against young music fans and their supposedly "unethical" behavior: to him, even if you are listening to a legal, licensed service like Spotify, you're "unethical" because he's heard rumors that Spotify doesn't pay enough.

However, the more you look, the more you realize that Spotify actually pays out quite a lot. A few months ago, someone at one of the music collection societies told me about an analysis they had done concerning the amount of money paid per listen -- comparing Spotify to radio, iTunes and lots of other things. When you knock it down to a per listen basis, it turns out that Spotify pays a hell of a lot more than any of those other sources. It's just that it's incremental so it looks smaller. With iTunes, people pay per download, not per listen, so you basically upfront a certain amount of money and then no more money is ever paid for listening to those songs. With radio, there is (effectively) a per listen rate (outside the US if we're talking performances), but it's aggregated because it's effectively spread among all the listeners. So, Spotify makes it incremental, and it seems small. but when measured on a per listen basis, the amount is significantly higher (as in an order of magnitude) than other things. The other bit of confusion about this is that Spotify is still new, and it's growing. But start from a small base, and it's easy to be confused by small numbers.

However, the info is starting to get out. Evolver.fm has some interesting details, starting with a leaked report showing that the payouts from Spotify to labels (including indies) have been increasing massively. They also have an interview with Merlin's CEO (Merlin represents a bunch of indie labels, giving it a lot of clout in negotiations). And Merlin says the claims of Spotify not paying out are bogus:

Spotify’s payouts to Merlin’s 10,000-plus indie labels rose 250 percent from the year ending March 2011 to the year ending March 2012. More importantly, the revenue per user (RPU) “has grown significantly alongside the overall revenue growth and is currently the highest it has been since the launch of the service,” said Caldas. “We see consistent, ongoing growth on revenue per user, revenue per stream, and the total revenue the service brings.”

So what's the real issue? Well, as Merlin's CEO says, Spotify pays labels, not artists. And labels aren't always great about paying artists. That's not Spotify's fault. It's what you get when you sign up for a major label that demands your copyrights (you know, the kind of system that David Lowery insists is better). There's also the issue with the growth of the service. Again, Merlin's CEO points out that Spotify has been growing a lot (helped along by its adoption in the US), but payments do take some time, first from Spotify to labels and then from labels to artists (if the labels ever do pay). So what artists are seeing is payments from quite some time ago, not what's actually happening today.

Meanwhile, Hypebot has a great interview with D.A. Wallach, who is both half of the very successful band Chester French (who we've written about for their amazing ability to connect with fans and their cool ideas like encouraging fans to share their music), and also the "artist in residence" at Spotify -- where he helps present the artist's viewpoint, and act as a liaison with other artists. In the interview, he points out that about 70% of Spotify's revenue is being paid out to copyright holders at this point:

Anyone who doesn’t think we’re paying a fair cut hasn’t seen the numbers we pay out. By far the vast majority of the money we’re making goes back to the owners of the music – about 70%. When compared to iTunes, the average listener spends $60 dollars a year into the creative community, whereas Spotify Premium users spend $120 per year. As “the pie gets bigger” so to speak, so do the royalty payments. The growth of the platform is proportional to the royalty pay out and since inception we’ve already doubled the effective per play rate.

Of course, once again, the money is going to the labels, and it's the label's job to disperse it to the artists. But to use those small payments as evidence against the "new" system is wrong, since it's still the "old" labels hanging onto the money.

There are, still, some legitimate concerns about how Spotify splits up its proceeds between major labels and indies, since the majors have an equity stake. So there is a reasonable concern about fairness. But the claim that Spotify just doesn't pay very much to artists is simply unfounded.

For ”Kalla mig” it means that we get more revenue per quarter from Spotify today than the single sold in its entire first successful year."

"We will soon have 500 songs in our catalogue, and Spotify has become by far the most profitable stream for us – almost 80% of our revenue comes from Spotify. And payments are increasing all the time."

I recommend anyone skeptical about 'the streaming model' to get in touch with people in the Scandinavian music industry (especially Sweden and Norway) and hear about their experiences.

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Scandinavia and scandinavia. In Denmark, Spotify was completely booted by artists and labels for giving far too little payback, a few years ago. I do not think they are any closer to a deal yet. It simply does not give enough clout for whining to politicians about piracy.

Missing the point.

The thing with Scandinavia is that they may find it much more beneficial to have a smaller part of a much larger pie. Something like Spotify can help give them better global visibility and market share.. They can take money from the US and the UK.

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Yeah, except that story is over a year old, is only estimates based on (extremely biased) sources, and in general is the type of math that Techdirt's article is debunking.

Also, you'll notice that none of these stories compare streaming rates to radio royalties. That's for two reasons: 1. None of the sources even count songwriter royalties, which are the only royalties terrestrial radio pays (meaning that recording artists would get $0 under their calculations); and 2) terrestrial radio rates are far lower than royalties from Spotify.

So, the digital royalties may not be anything special (and certainly one shouldn't count on making a living through Spotify alone). But they're still far greater than any royalties that existed in the analog past.

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"Yeah, except that story is over a year old, is only estimates based on (extremely biased) sources, and in general is the type of math that Techdirt's article is debunking."

In fact, the image on that graphic is listed as being from April 2010 (over 2 years ago!), and is deliberately misleading in ways that should be obvious to anyone with 2 brain cells to rub together. For example, it specifically refers to US earnings at the top but it's from well before Spotify launched in the US so it refers to a half-assed conversion from UK earnings for Spotify (and it was only available on a limited basis in the UK from February 2009, and for much of 2009 was only available there on a invitation basis).

So, we have a completely out of date information source for a company whose paying userbase has increased exponentially, is available in far more countries, and will have modified its payment structures in the intervening years - IIRC, they had to make a number of concessions regarding royalties before they were allowed to launch in the US. It also makes the utterly moronic comparison at the end to sales, not radio. I only skimmed the rest - such openly misleading stupidity isn't worth wasting too much time with.

Yet, ACs march in here pretending it must be the gospel truth because it fits their preconceived assumptions. What a surprise.

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"Freetard Censorship! Awesome. How many of their own talking points can they contradict in a week?"

Interesting question. Let's find out....

"Not Much To Say About It
- Than write seven full posts responding to david Lowery"

Nope. Writing posts about other people's response to Lowery, which didn't exist at the time of your quotation. Strike one.

"Streisand Effect
- Than focus on the thing you want to go away"

First, learn to spell "then". And strike two, since the focus is on the response to Lowery, which we certainly DON'T want to go away, and that isn't the proper definition of the Streisand Effect anyway, so strike three. Next batter.

"Censorship
- If you can't make it go away, Censor it!"

Nope. Censorship is something a governing body does to disappear content. We're not a governing body and your uninformed childish tantrums are still there. Collapsing the comment with a red highlight so people can find it isn't censorship. Strike four.

"Support RIAA
- Spotify is 18% owned Equity by the RIAA Labels!"

So? This blog doesn't call for a boycot of the RIAA or their labels. Strike five....

"Than claim confusion over "what happened last week"..."

Confusion? You're the only one confused here, tardo. Strike six.

You know, if you have three more easily refuted points to make, we could make this a perfect inning....

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Here's a fun analogy, dumbass. Techdirt censors comments every bit as much as you're "shouting down" the article by posting your stupid comments. Granted, you can't really say you've shouted down the article when it still appears above for anyone undistracted to read, but then so do your "censored" comments appear for anyone who wishes to read them as well, so you can see the correlation.

Actually...you probably can't. I should try to make this easy for you.

Oy! Fuckface! Censorship make words disappear! Community flags still there to read. You like Jane, Tarzan?

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back at you, half my comments don't get posted at all... that's CENSORSHIP... not a flag... learn the difference.

Just checked. There are no comments from you in our spam filter (unless you are also leaving comments trying to promote mortgage loans). So... not sure what you're talking about. Maybe you are just repeating the same thing so much that you are losing count of your own comments.

"Wait, no, I'm sure I frothed at the mouth thirty-seven times on that thread but I only see thirty-four!"

A few days ago, our digital strategist, Dave Allen, posted opinions about the role of the Internet as a catalyst for change in the turbulent music business. It was in response to a popular piece posted by David Lowery on his blog, which in turn was a response to a post by Emily White, an intern at NPR.

We fully support Dave’s positions regarding the Internet and the music business. We find no reason to fault Emily White and her generation for an inevitable business truth about the way music (and many other forms of creativity) are now enjoyed.

Dave is passionate about the issues, as we are. As a result, his post included some personal opinions about David Lowery that were less than kind. For that, we sincerely apologize and regret the distraction.

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It shows that Zune, Napster, and Rhapsody offer much better deals for content providers than does Spotify, but it doesn't mean Spotify is bad for artists.

Remember, each of those points is per listen. For each song you purchase on iTunes, how many times are you going to listen to it over its lifetime? If it's greater than 140, then Spotify is a better deal for the artist than iTunes.

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You seem to think you are making a point, but you're just proving ours. As the article says, download the song, you play it as much as you want. The money for all 14, 140, 14 million of that person's theoretical plays is received up front. Spotify pays per actual play, so you have to wait until the plays happen to reach the same level of revenue. I fail to see what the problem is.

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The key number isn't the amount per play but what the average listener spends per year. For iTunes, that's $60. For Spotify, it's $120.

Here's why it might seem different though -- if you spent $60 on iTunes, that basically means you bought 60 songs, and you're going to listen to those 60 songs A LOT. And if you're only buying 60 songs, you're probably going to focus on the top hits and not much else.

By contrast, if you spend $120 on Spotify, there's no limit on how many songs you can listen to. It's probably a lot more than 60 or 120. And you're also more likely to less popular and more esoteric songs.

So what happens on Spotify is that the OVERALL amount of money going to the creative community (per listener) is higher. But it's distributed much more evenly than with iTunes. If you're a Top 40 act, then it might appear that Spotify is screwing you over. And to some extent, it is, but it's screwing you over to help less popular up-and-coming acts. You can interpret that how you want.

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Heh. I agree but - go read the Ethics post comments from yesterday. Note the guy repeatedly saying the same thing over and over and over again (literally dozens and dozens of times) despite absolutely anything said to him, in a pure attempt to childishly derail the thread. 100% genuine dedicated trolling.

That's who we're talking about. Nothing is served by attempting to call him out. His entire goal is to ensure that no real points get made, and no real discussion happens, by getting everyone to focus on him even though he's probably not even reading what they say in their comments.

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but it's funny leigh, what is this like post number seven on tech dirt that mentions lowery? why is that? What happened last week? Why won't you guys tell me what happened last week that requires now SEVEN responses from TechDirt about David Lowery when Mike said that there was "Not much to say about it"

CENSORSHIP! Here we come! It's you guys who can't handle answering questions. What happened last week? I dunno? No much to say about it.... Uhm... OK... let's write SEVEN posts about David Lowery...

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As proven by the fact that I can still read your posts by merely clicking on the text "This comment has been flagged by the community. Click to show the comment," TechDirt wins. How many moderated posts can I un-hide on Trichordist, hmm?

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@ Zakida Paul - Yes, I agree. When an idiot say there's "not much to say about it" and then goes on to write seven full posts in response to the thing he had "not much to say about" followed by asking the question "what happened last week?" Yes, they should be called out, and that is how you learn.

Two Words: Streisand Effect.

You guys seem really, really confused and misinformed. As usual...

Here comes the CENSORSHIP right? Can't stand to actually have the truth and the light upon you?

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I agree. But only on one condition. We just "censor" his post. If all he's going to do is spam and derail the thread with the same "not really much to say" and "stop whining" and "Streisand Effect" stuff as yesterday, we just report it and move on.

And for fuck's sake (not aiming this at your Leigh), REPORTING SPAM (WHICH IS WHAT THAT GUY DOES) IS NOT CENSORSHIP! Especially not when the comment has NOT magically disappeared, which is basically what censorship does. Makes things magically disappear forever. And that is me simplifying it like crazy, in the hopes some ACs (you know who you are) will stop repeating that same talking point.

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why are you so angry!? get over it already! There's just "not much to say about it." And I don't even know what happened last week that would cause techdirt to write seven posts about David Lowery in a week... One A Day...

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who are you talking about? Why can't you just answer the question? What happened last week? I understand that there's not much to say about it, but wondering why it's now post number seven on TechDirt about David Lowery?

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The lesson that Lowery and other IP maximallists will take away from this article is that iTunes is evil because users only pay once and can listen as often as they want forever. Obviously that is a flawed model.

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Cory of PC, would you mind if I quote you? I'd like to quote the following: "I don't know; the Internet works in mysterious ways."

I feel a need to have that printed on a banner and hang it over my work area in my cubicle, for moments when I'm not in it and people come looking for "the IT guy". I love that "Internet" is capitalized too. Makes it sound alive.

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I don't know. I rarely see it capitalized. Like ever, honestly. And that's across a variety of sites, many of which are tech sites. I can't think of a single instance at all (and I have a pretty good memory) where I've seen it capitalized.

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you don't really see internet capitalized as much these days... originally it was "officially" capitalized and it's the sort of thing old-school journalists still debate in newsrooms, but my impression is that among internet users the casual form is more common these days...

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Reminds me of people discussing the name for machine code, old school people called "assembler language" the new cool kids call it "assembly language" and I get someone calling me an idiot once in a while when I write "assembler then I point the dude to Amazon and the books from the 70's and 80's written about "Assembler Language", after that I issue a JMP to proceed without making a comparison or have the dude write a JE/JNE statement LoL

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Before the trolls stink up the place, I'd just like to point out one of the major flaws in the anti-Spotify argument, which is assumptions of how people actually use Spotify.

Most of the anti brigade seem to assume that Spotify replaces sales, and thus panic at the naturally lower revenue. But, it doesn't for many people. If anything, if replaces radio. Personally, I use Spotify all the time, but not to listen to music I would otherwise buy. Sometimes I use it to check out new music, or classic albums I've never listened to (but would never blind buy).

More importantly, I use it to listen to music I haven't got on my device. That's half the joy of using the service. I'm not limited to whatever 10 albums I happened to have synced to my phone a few days ago, I can listen to any music I want right now as long as the morons at the label haven't blocked them from offering it to me. That is, every time I listen to an album, the artists get paid *even if I've already bought the album*. I'm never going to buy another copy of Hybrid Theory or Black Holes And Revelations, but the artists in question still get paid when I listen to their music.

That's part of the joy. I pay a monthly fee to Spotify, I get access to more music than I could possibly buy, my listening experience is improved and there's no reason for me to resort to piracy to preview or relisten to an album.

Apparently, this is somehow a problem... Probably because Spotify hands more control over to the user, and thus revenue gets generated for music that hasn't been pre-approved by a major corporation. They can't control a user's listening habits through Spotify like they can through radio.

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Have an insightful vote. You are absolutely spot on. I don't use Spotify as I prefer Last FM but I use it to discover new music, I cannot tell you how much music I have bought since joining Last FM. That is sales that artists would not have had otherwise.

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"Nearly two thirds of those participating in the research, who admitted to illegally downloading music, said using Spotify had encouraged them to reduce the amount they used pirate sites or kick the habit altogether."

You'll never see Lowery point to this article, then again he think Spotify is run by a greedy corporate shill despite the fact the company loses money from operational costs after paying out to the labels.

Also, on the subject of conversions. I also use Spotify to check out new music instead of giving into the desire to download.

The other funny thing they don't mention is what if you continue listening to an artists tunes from Spotify instead of your own library? Recently, I purchased the new Keane album (after trying it out on Spotify), but the version on Spotify offers bonus songs so I am more inclined to just deal with the advertising (I don't find it very intrusive at all) just to listen to the extra songs.

So basically, Keane made revenue from a sale and from streaming. Maybe if Lowery spent less time whining about not getting paid and actually making good music, then he could see the same thing.

Where Spotify fails...

I do agree with you. Spotify replaces radio, though mainly through the benefit of twitter and blogs as the further away from whatever is considered mainstream at the moment you are the less use you get from their totally un-doctored tips you get.
But, what I still can't understand is why Spotify won't take their product further and actually sell me the CD's. Get a deal together with Amazon or some other large worldwide distributor and let me buy the fricking CD's with a mouse click. And sell me t-shirts and other merch while you're at it. Let every band have a portal for merch and CD'sales inside Spotify. Monetize, people... monetize!

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"So you do know that you are now supporting the RIAA who owns 18% of Spotify along with the Major Labels right? "

One of your many, many failings is the inability to look at anything in shades of grey, only seeing them in simplistic black and white.

In this example, it's perfectly possible to be critical of the RIAA's stupid tactics and question their business models, while still being supportive of their more sensible approaches. In fact, the so-called anti-RIAA folks can get their message across better by doing this because the pro-industry folk then lose the "waah piracy" excuse when faced with yet more evidence that their business models are the problem.

No hypocrisy required, just a more nuanced understanding of reality than you're capable of. It's just a shame that such opportunities to support their correct moves are rare.

"TechDirt loves any model that screws artists even if it means supporting the RIAA... well done!"

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Bullshit. I have no label, I get paid. $.01 per download on Spotify. How the fuck is the record company ripping me off. I love the fact that all of you assholes that want your cheap music coming make all types of excuses for it. If you got paid what we do, you'd quit your job. Fuck you to this author and all that agree with him...ignorant asshole.

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No you don't. Spotify is not a download service. If you don't know the difference between a stream and a download, you're too ignorant of the business for any criticism you get to be taken seriously.

Why is every self-proclaimed "musician" who responds to these points not only ignorant of what the services they attack actually do, but have the emotional maturity of a toddler and are afraid to identify themselves?

Seriously, just once, can we have an adult with some reasonable argument to address?

Mike, I completely agree with the majority of what you're saying. As an artist, when you sign on, you're getting all of the power of the label and there is a compromise inherent to that decision.

However, many artist, and Label's issues with Spotify come from their lack of transparency when it comes to the actual creation of value of their content (wares) within their system.

As you know, Spotify sells access, not spins. However, that's how we as artists and labels get paid per spin. This is no way as cut and dried as Itunes where there is a set value of a barely durable good, Apple takes 30% and the rest goes down the line.

Spotify creates value based on a 90 day cycle of income from various revenue streams. Paid subscription, and advertising. Now, apparently once they have that number they take out "operation costs" and develop what we see as a per spin value on our statements from our distributors or aggregators.

At this point, it's getting fuzzy, because we're seeing cash influxes from enormous corporate sponsors like Coke, more private cash injections in the hundreds of millions (which would feasibly cover expansion and operation costs) however the per spin rate is moving at a slugs pace, and there is absolutely zero info given as to how we are to speculate when or how it will get better. It would behoove them to truly who how the "pie" will get better with hard numbers, which they haven't. It's easier to perpetuate ambiguity without that.

This doesn't sound like anything new to many of us. It sounds like old school, back door dealing that takes value away from what's powering the service itself, the content and people who create that content.

As far as DA Wallach, he's a quasi celebrity press correspondent on their payroll, who is as evasive as the next employee. As well spoken as he is, I just can't take him any more seriously.

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I see your point but I don't think I agree with you. Spotify, like any company, has no obligation (not publicly traded) to give you access to all their inner workings / finances. The labels can determine if they think the service Spotify provides is valuable to them, and whether or not to participate. It's almost akin to DRM. I have no problem with companies placing DRM on their services/digital media but my chances of buying at that point have gone way down.

If somebody thinks they can do better (maybe similar model to Spotify but with more transparency) that would be great. More competition could potentially lead to two better services.

Spotify has gotten quite aggressive with their goals of acquiring lots of music content, and I applaud them for that. I pay for a premium subscription and I am completely happy with everything but how "offline mode" works. I can't sync mobile devices nearly quickly enough.

Before this last year I had probably not spent any money on music in around 6 years besides shows. And to be clear, I wasn't pirating music in that time period. I was a student who had slowly stopped listening to music (relatively).

Spotify has probably increased the amount of music I listen to by 500-1000% and has monetized that with me paying for a 120$ year subscription. And regardless of what slice of the pie they are taking before "paying out" labels and artists, I'm willing to bet their cut is more generous than the major labels.

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You bring up some good points, and in the end even if Spotify wanted to clear things up, it's not up to them. There are many investors interests in mind and at the end of the day this is a business that first needs to turn a profit (revolutionizing the way we experience music is actually secondary, or even tertiary when compared to paying back investors or major labels).

Have they been successful in acquiring the near ubiquity they'll need to dominate the marketspace? Almost. But as it's been brought up before, great music and art is forever, the nature of technology is fleeting and we'll see how things progress as we move closer to what to me is a reasonable endgame, a potential IPO.

As an artist, I completely embrace the streaming concept and am a paying Spotify subscriber. It's changed so much for me, and my family. However, as someone who's worked in this industry for years, there are too many reminders of the way things used to be, which contrary to what Mr. Lowery says, was not that great.

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Oh Yeah... I agree Spotify is powerless as controlled by the RIAA and the labels that have an 18% equity stake. Yeah it's so awesome that TechDirt has FINALLY come around to supporting the RIAA and it's labels. What took you so long?

TechDirt all for screwing artists even if it means supporting the RIAA!

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"seven posts later on tech dirt about david lowery and there's still "not much to say about it.""

Hey, numb nuts, are you having a stroke or something? This quote you keep putting out from Mike was about responding to Lowery's post. He isn't doing that. He's writing about the RESPONSE to Lowery's post. Case in point, this article is NOT ABOUT LOWERY'S post. It's central theme is the response of details about Spotify to the bullshit spector Lowery raised....

Seriously, not only is your boring mantra irritating, it's also WRONG....

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LOL

GARGLE-BARGLE GARGLE GARGLE.

Seriously, dumbass, where am I wrong? Do me a favor and tell me how Techdirt isn't writing about the RESPONSE to Lowery's bullshit, or go figure out the quickest way to acquire cancer so we don't have to deal with your uninformed, neandrathalic nonsense any longer....

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Oh look, you need to reach a threshold meaning only one guy reporting something can't trigger the hiding function LoL

Which means, you either need to get more people to help you, or you need to write a bot to do it for ya, or you need to get administrative privileges to access the control panel of the blog, or find someone who has that access.

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When we shake our creative fists at the sky... it's filled with gold coins as we open them.

Magic! *

* Please note that I'm using the definition of the word where 'magic' means adjusting to the realities of the digital age, primarily non-linear (networked) communication, and building business models on top of that.

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I'm skeptical of this article. I use Spotify and Pandora for most of my music listening, but this article was lacking in concrete numbers.

It has quotes about how Spotify payments have risen tremendously in comparison to a year ago. It has quotes about the *average* iTunes user being $60 per year and spotify Premium users being $120 per year. But it doesn't have any information giving solid, absolute comparisons of how much money any artist is making off of Spotify.

If Spotify revenue grew from $0.01 to $0.05 per artist per year and had a single Spotify premium user, this article would still be factual.

I'll hold off until I see numbers that are easier to comprehend in absolutes.

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oh look, it's Mike Masnick's daily rant against David Lowery but the good news is Mike has finally come around to support the RIAA. Now we always knew it was just a matter of time until we'd see you guys embrace the RIAA for your own gains.

too funny...

TechDirt Finally Realizes the RIAA Was Right Along joins the notorious Major Label Trade Group in supporting Spotify Ripping Off Artists

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Response to: Anonymous Coward on Jun 26th, 2012 @ 8:56am

Very good points indeed… This article really says nothing. Not a whole lot of concrete information here… And to be truly scientific about the situation that is exactly what we need. Oh and all of you folks who want to blame the record labels? I laugh at you every time. The vast majority of labels out there are small independent establishments who treat artists more than fairly. Sure the major labels have some ethical issues… But when I advocate for artists that is not what Id am worried about. Although I have no problem with labels being big… But even with their grandiose size… They still have an obligation to treat their employees (artists) fairly. I love how most of you are slamming David Lowery but it's clear that a lot of you have no idea who he is. This article actually slanders him pretty good at one point when it says that he would rather artists buy into a system where they sign with a major label and the major-label rips them off. That is completely false. Anyone who takes the time to read Mr. Lowery's blogs should realize that he advocates for independent labels and independent artists. For the record though, I am completely four music streaming services. I am not here to launch into some sort of diatribe about how they cannot work… But I think it is completely reasonable to be very aware of the ethical nature of these large corporations who are providing these streaming services. Oh and Paul… Your arguments are actually quite weak in a lot of areas. Accusing somebody of taking seven months to come up with a response is completely erroneous. Everyone finds articles at different times. And calling this person out for possibly not being an artist? Yeah… Now you're just milking it. Please grow up. You look like a teenager who just joined the debate team. And furthermore… Accusing artists of whining? We deserve to be compensated fairly just like everyone else… And when there is a possibility that this is not happening… we as artists and musicians have every right to raise our voice. You accusing artists of whining when not being compensated fairly (which they have a right to be fairly compensated) is very much the same as a right wing conservative Christian accusing same-sex couples of complaining over equal marriage rights. This is essentially cultural discrimination… And prejudice. This software developers were not being paid fairly they would have just as much of a right to complain… Or whatever it is that you do… I know it's something with software… I saw your comment… But I think you understand what I'm saying… Or maybe you don't which would be rather unfortunate.

Dream on

It is rather hilarious to read phrases like this:

" it's easy to be confused by small numbers. "

Especially in the middle of an article celebrating how we shouldn't be fooled by these small numbers because the idea that Spotify barely pays is bunk. In other words, don't believe what your eyes tell you when you read the numbers, believe what the Kool Aid is telling your brain.

And I generally like Spotify but I think Mike is dreaming if he believes that everyone is going to rush off and pay them $120 a year to be premium members. They're not. And until they do, Spotify isn't going to pay much.

Re: Dream on

Re: Dream on

So which bullshit point are you trying to imply here? That free Spotify members don't generate any revenue (citation please)? That everyone has to pay the subscription (never claimed)? You have to help me here, because I can't debate your actual point in this reality without you translating it from your fiction first.

"And until they do, Spotify isn't going to pay much."

More than piracy, and infinitely more than you think if you believe that the only revenue generated by Spotify for artists is whatever royalty they get directly from streams.

"Kool Aid"

I've never seen any regular posters outside of the troll contingent to stick to a single party line. It might seem like we do when all we get from your "side" is repeated lies and distortions, but there's real debate being had when your spambot brothers aren't in operation.

Which is fitting, given what ended up happening to those who did actually drink the Kool Aid (actually Flavor Aid) in Jonestown. I just wish you guys would hurry up and follow them, so that we can debate real issues in peace. While enjoying the new art and access to said art that people like you are trying to destroy.

Re: Re: Re: Re: buzzing?

Hey now, be nice. Mike at least does his research. Your leader, Lowery, just whines, but never actually provides solutions.

I mean, like I said before, it's a sweet gig because it means you don't have to do ANYTHING. We all know that's Lowery best talent, since he's sitting on so much empirical data and not talking about it.

Re:

I just did a quick tally. At 79 comments total, an astounding 28 have been reported for the spam and ad homs they are. Think about that, a little over one third of the comments have been from the same idiot(s) spamming yet another thread. How ridiculous is that? [he ask rhetorically] Yet, discussion has not been interrupted like on previous occasions.

Leigh, I think you may be on to something. I say, kudos to everyone just going about their day/business and ignoring the one idiot. The comments thus far have been relatively interesting to read.

I'm a former Spotify user. I tried it when it was free, but when they switched to the "use a Facebook login" I basically bailed. Did they get rid of that yet? Anyone know? I'd heard they were, when and if they do I'll use their service again. I genuinely liked it. Of course, I've been a Pandora user for much longer, so I prefer that (or even Slacker), but Spotify is growing and gaining traction. Something I enjoy seeing in general. A new competitor entering the rather small market and making a place for itself.

from the use-a-fking-dictionary-to-lookup-the-meaning-of-word-'censorship' dept.

Well, I think that we learned something today.

We learned that Mike censors opinions he doesn't agree with. Shocking, I know, and I hear some of you crying "But AC, what proof do you have of this heinous act?". Well, my proof is so irrefutable that even the sceptics will be forced to accept its validity.

See those red sentences in the comments that say "This comment has been flagged by the community. Click to show it."? That sentence, written in ancient script, is a mark that has for long (since around 2009, If memory serves me right) been used to denote comments that have been censored. It roughly translates to "This comment has been flagged by the community. Click to show it.".

Not convinced yet? Well, then I dare you to click on that red text (NoScript users, skip this step). If you do, the full horror of Mike's censorship mechanism will be revealed: the full text that Mike was censoring will appear, as if by magic. You can read all of it for yourself, and see that I do not lie.

This clear censorship of dissenting opinions should be frowned upon, and I suggest that we unite as a community, and look sternly at Mike Masnick. Maybe then, he'll learn his lesson and probably put that text in all caps, since people still don't get it.

Re: from the use-a-fking-dictionary-to-lookup-the-meaning-of-word-'censorship' dept.

Yeah. I just opened all of them and there's absolutely no problem reading them whasoe--holy shit. I think someone just kicked down my door. OMG TEARGAS! If you don't hear from me in 24 hours, launch a Kickstarter to rescue me from the Ministry of Love!

Re: from the use-a-fking-dictionary-to-lookup-the-meaning-of-word-'censorship' dept.

"Well, I think that we learned something today."

We learned a few somethings today. Number 1: You obviously don't know the meaning of the word "censorship". Number 2: Mike DOES NOT censor people he doesn't agree with (proof of that is evident by you being allowed to post). Number 3: The COMMUNITY (meaning the majority of people reading this site) think people like you making "censorship" claims and spamming threads is unacceptable and are reportig them accordingly.
"Well, my proof is so irrefutable that even the sceptics will be forced to accept its validity.

See those red sentences in the comments that say "This comment has been flagged by the community. Click to show it."? That sentence, written in ancient script, is a mark that has for long (since around 2009, If memory serves me right) been used to denote comments that have been censored. It roughly translates to "This comment has been flagged by the community. Click to show it.".

Not convinced yet? Well, then I dare you to click on that red text (NoScript users, skip this step). If you do, the full horror of Mike's censorship mechanism will be revealed: the full text that Mike was censoring will appear, as if by magic. You can read all of it for yourself, and see that I do not lie.

This clear censorship of dissenting opinions should be frowned upon, and I suggest that we unite as a community, and look sternly at Mike Masnick. Maybe then, he'll learn his lesson and probably put that text in all caps, since people still don't get it."

I see, so your "proof" of "censorship" are those comments that are still viewable? See "Number 1" up above for my response to that. There is nothing wrong with having a dissenting opinion, I'll tell you like I told the other idiot making the same things yesterday. Have one all you want (a dissenting opinion that is). No one has a problem with that. It is when you start spamming threads, insulting others, and that sort of thing that comments will be reported. I've had mine reported once or twice. Why? Well, honestly, I was parodying people like you and apparently did too well a job of it. But in no way was I censored. Also, like I said yesterday, see the article about the facts that debunk Lowery's claims and you'll realize there were quite a few people with dissenting opinions, the one that comes to mind easily was Hmmmm's comments. Go have a look. Clearly dissenting, but presented in a respectful and reasonable fashion, with attempts to support his/her comments/claims. Not a single one was reported. Thus, your "proof" is quite obviously negated. But thanks for playing.

I'll say to you what we all regularly say to bob, "Get a clue and then think long and hard before you click 'Submit' and post. Otherwise we're going to call you out on your BS."

Re: Re:

Lol. Well, idiot, it feels alright. I'm not one to get too hung up on things that have no real discernible consequence on me.

You see, I DID NOT call someone an idiot for having a dissenting opinion. That's your first mistake. I called one particular AC (or group of them) an idiot (or idiots) because said AC is spamming certain threads on a daily basis with the same nonsense over and over. He/she is NOT having a dissenting opinion but attempting to derail the threads and/or trolling in general.

If the AC in question would just voice an opinion that was dissenting I would have no problem with it. However, since all said AC is going to do is repeat the same thing (of course with minor variations) multiple times and not actually say anything, then I feel it is acceptable to report the comment for spam. But thanks for proving a wonderful point. Some of you ACs seriously suck at reading comprehension. I honestly don't know how you made it through school. I do have my theories though. Perhaps before you report someone you should make sure you actually understand what they're saying, otherwise you look like an even bigger idiot than the idiot I called an idiot in the first place. And while it is admirable to defend another, it is not admirable or at all logical to defend the guy who is quite clearly spamming this thread.

Payment to indie artists?

I'm interested in how much Spotify pays to independent artists, who are not on a label, or have their own label. When Spotify says it pays labels, not artists, where does that leave the independent artists?

It stands to reason that for labels with many artists, the Spotify revenue stream would add up to something more reasonable. But what about the individual artist?

Re: Payment to indie artists?

I asked a friend of mine who is part of a band called Beats Noir (http://www.beatsnoir.com/Beatsnoir.com/Beats_Noir%21.html - shameless ad) and he wasn't too sure who they go through. They're not on a label, but Spotify's website says - "The current solution we offer indie artists is to make their deliveries through Record Union, CDBaby, Ditto Music and Zimbalam. They are artist-aggregators..." so I am guessing they use one of the services listed as aggregators.

Googly, googly, googlypants...

So, not only did you justify trichordist's moderating of posts (and call everyone a thief again), you claim Techdirt does the same and somehow this makes it worse? (Not to mention the whole "support the RIAA" thing? Did you think that flipping things around would make your argument stronger?)

So not only do you waste your time here spamming us with useless links, you get the FOUR GUYS it takes to run your blog and post TWICE as much useless links?

Have you guys seriously considered marketing your spit as shoe polish? Because for all the whining you guys keep doing you don't seem to be too interested in feeding your families. Unless spamming trichordist links actually - gasp! - feeds you with ad revenue! OMG AD REVENUE BIG SEARCH EVIL!

Why do you guys give so much lip service to such a douchebaggy asstroll as lowreytroll? He makes little if any sense and he repeats the same shit over, and over, and over. I am sure if the discussion would have gone on and no one addressed his shitty diaper comments he would have sulked off to some other corner of the internet, or at least fire off another gem of an "article" for the trichordist.

Working for the record companies

Both Pandora and Spotify are basically working for the record companies. Both companies are giving over 60% of their revenue just for royalties and both companies are still losing money because the royalty model is unsustainable. Britain had pirate radio stations because stations couldn't make money while also paying the music performance royalties. How long can Pandora and Spotify hold out under the current fee schedule?

Re: Working for the record companies

There isn't anything fundamentally wrong with giving money to the record companies. Most people are opposed to the way they abuse copyright and insist the world turn back the clock. If they can make a profit in the real world with the internet than maybe they can stop screaming about how the sky is falling and stop being the reason we can't have nice stuff. The fact that labels take advantage of their artists and cheat them is a non-issue here and services like Pandora, Spotify, and Itunes increase the ability of artists to avoid that abuse.

As for how long Pandora and Spotify can 'hold out' under the current fee schedule is a business decision for their shareholders to decide. Currently however it seems like they are likely to 'hold out' indefinitely as they are either profitable or have growth the indicates that they will be profitable in the near future. Barring new technologies, better competitors, or changes in copyright law significantly increasing fees I expect I will still be using them in 15 years.

do the math

Spotify is said to pay 0.00966947678815 per listen. So someone listens to his favorite song 100 times 96 cents is paid. That is way more then iTunes pays artists when they sell a song for 99 cents (Apple deducts their share of ~30%). Can we assume that popular songs are listened to 100 times in several years of ownership? Of course.

Popular songs on youtube are easily watched 20 million times. that would mean over a 193,000 dollars on Spotify. Not that bad coming from just one medium / channel.

two sides...

I am glad I see two sides to this story, but it makes it harder to know what to believe. The article I link here seems to have a different POV with some facts, statistics and support that seem legitimate as they are directly involved in the game. http://www.digitalmusicnews.com/permalink/2012/120604youtube

Spotify

Sometime last year I heard one of Spotify's founders - I don't remember if it was Ek or Lorentzon - interviewed on the radio. He was talking about the problem of "music piracy" in Sweden and said that he wanted to start a business that gave back to ... At this point I was sure he was going to say "artists", but instead he said ... "the music industry". This statement astonished me and I resolved never to use Spotify, regardless of whatever selective statistics he or his defenders might throw at me.

This article is complete nonsense. Congratulations to the folks over at Spotify as they have found a legal way to rip off artists. I'm an artist and Spotify pays me next to nothing but you can be sure the exes at Spotify are making a bunch. These jokers are supported by the big labels. Itunes is a much fairer way to get your music by making sure the money goes to the artists themselves. Thank you.

Re:

"Congratulations to the folks over at Spotify as they have found a legal way to rip off artists"

Bullshit.

"I'm an artist"

Probably also bullshit, but feel free to prove it, and promote your music on this free forum in the process. All you've shown so far is that your ability to advertise your product is equal to your lack of ability to understand Spotify, or explain what it is you have a problem with. Except:

"Itunes is a much fairer way to get your music by making sure the money goes to the artists themselves"

Oh, this rubbish again. Two things - first Spotify is rental, iTunes is purchase. Of course you'll get more money via the latter, just as no movie gets the full theatrical revenue when it's on TV. Compare your revenue from them to your revenue from other per-play venues like radio, club or similar streaming service. Spotify might still not come on top, but at least you will be comparing apples to apples somewhat. As it is, you're comparing completely different products. On top of that, iTunes takes 60% of the revenue from their sales, and labels take the lion's share of the rest. Realistically iTunes isn't "fairer" unless by "fairer" you mean" I might make more money" - but of course you will since it's a completely different venue.

In other words, here we have another whining "artist" whose anger is not only misplaced but based on outright fallacies from the beginning. A shame it took you 7 months to come up with such a poor comment.

Re: Re:

Jesus Christ man. I stumbled across this post looking for a royalty rate and figured I'd see what the last comment was... Tell me, Paul, do you honestly troll around seven month old posts just to pick fights? I'm not one for ad hominem, but you need a life, and it seems like you might need a job, too. Unless astroturfing at TD is your gig?

No wonder I see people butting heads with you. I figured they were just idiots, but it turns out that you're kind of an asshole. Seriously, think about where you are in your life and ask yourself if you might not be accomplishing something more productive?

Re: Re: Re:

"Tell me, Paul, do you honestly troll around seven month old posts just to pick fights?"

No. I'm sorry to shatter the half assed assumptions you made about me, but you're an asshole for making them. I tick the box marked "email me when there's new comments". That means that if someone comments - even on articles that are old - I get an email. If someone says something stupid, I may respond. Especially when bored - as I sometimes am when I comment here, usually during downtime during my sys admin/development job that often requires waiting for things to install or compile.

Oh, and learn the definition of a troll. "Making comments on old threads" and "correcting people when they make blatantly untrue statements" (as per the lies I was responding to) do not fit.

"I'm not one for ad hominem"

Yet, that's all your comment was. Nice.

"Meanwhile, I'm going to get back to making money."

I'm being paid as I write this, plus my other projects outside of work are passively making me money as I sit here. It's a shame when reality doesn't match up to stupid assumptions, isn't it?

Oh and before any of you try and use the organization or grammar of my post to try and D rail my argument… I have a visual impairment and was dictating the post into my iPhone. I tried to correct all the mistakes but I accidentally hit the submit button before I got to all of them so you're going to half to deal with it. And besides… Anytime anyone tries to use someone else's grammar or literary skills to derail their argument it is completely irrelevant. That just shows that you do not have a solid response prepared and you just want to make your own post look more powerful by adding more text and bringing up seemingly relevant information but in the end it really has no bearing to the current situation whatsoever.

As an artist

If you ever got a check from Spotify you might understand how much they are ripping off the artists. 89 plays got us .38 cents.

Hope you all like DJs cause bands will not be around for much longer under these condition.

Cost about 10,000 to record with a great producer in a quality studio. Spent about 6 months writing the songs. Then everyone will get it for free on Spotify and not need to buy it. .38 cents for 89 plays. Think about that...

Re: As an artist

Cost about 10,000 to record with a great producer in a quality studio. Spent about 6 months writing the songs.

Yes, it costs money to produce an album. No one disputes this. But, just like any other business venture there is risk involved.

Then everyone will get it for free on Spotify and not need to buy it.

You are not seeing the whole picture here. A record/8-track/cassette/CD purchase is a one time purchase that includes unlimited replays forever. Spotify pays you every time your song is played from now on. Think about that...

38 cents for 89 plays. Think about that...

Isn't the idea for that play number to be in the hundreds or thousands? Seriously, how much money are you receiving for selling 9 CDs that get played 10 times each which is more than 89 plays?

Don't forget, alot of spotify users were getting all their music from torrent sites 2 years ago, and paying absolutely nothing to labels or artists. If a ten dollar monthly charge is removing a large portion of content pirates from at least music, isn't that a good thing?

Stop Stealing Music Makers Money

Re: Stop Stealing Music Makers Money

I love it when idiots claim that a website that people pay money to in order to listen to their music is "stealing" from them. As always, I honestly hope that the money I pay every month to Spotify and to other music services isn't accidental;ly funding lying dickheads like you.

Spotify Does not Pay Artists

If you are an composer and you spend 6 months writing songs, spending tons of money on recordings and then having Spotify collect tons of revenue for subscriptions and then get paid 0.007 cents for every time some one listens to the songs you wrote it's humiliating - it's terrible. I am an artist and trust me the 0.007 cents I get per stream is a joke - I'm not sure how musicians can survive while the industry robs them, collects their creations for free, and fails to support them. Glad Taylor Swift Pulled her music from this service - this article is a lie.